Childcare industry pushes direct rebate to centres

CHILDCARE operators are pushing the federal government to have the multibillion-dollar rebate paid directly to them and to fund a series of capital expenditure grants as part of a plan to tackle the cost and availability of care.

Early Childhood Australia, which represents most private long daycare centre operators, says parents would effectively have their fees halved if the rebate was paid directly to centres rather than as a refund.

''To ensure that families do not have to cover fees upfront before receiving reimbursement and that early childhood education and care centres receive the payments they require to operate, we are recommending the government pay the rebate directly to centres,'' the chief executive of Early Childhood Australia, Samantha Page, said.

At the moment there is a complicated system of payments that makes it difficult for parents to determine the real out-of-pocket cost of childcare.

The childcare benefit is means tested and paid directly to centres, which then accordingly reduce the initial fees paid by parents.

The rebate is not means tested and covers up to $7500 a child per year for the out-of-pocket cost for care.

Only about a third of parents choose to have the rebate paid directly to their childcare centre, which effectively reduces their fees before they pay them.

Most parents receive the money once Centrelink receives the invoice from the centre - often months after they have paid their fees.

As part of its pre-budget submission, Early Childhood Australia is also calling on the government to act on a recommendation made by the Henry tax review to combine the two childcare payments into a single payment.

Greater investment was also needed to pay staff professional wages, Ms Page said. A group of Labor MPs is backing the wage case, saying it is unfair of the government to require higher qualification standards and greater numbers of staff in each centre without providing funding for better wages.

To help ease the chronic shortage of childcare places in many inner-city areas, Ms Page said the federal government could offer low or no-interest capital loans to childcare operators interested in opening centres in areas of demonstrated demand. A similar program is available to aged-care operators.